Alcon Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

It's been a good week for Alcon Inc. (VTX:ALC) shareholders, because the company has just released its latest full-year results, and the shares gained 3.0% to CHF83.00. Alcon reported US$9.9b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$2.05 beat expectations, being 7.8% higher than what the analysts expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Alcon

Taking into account the latest results, the most recent consensus for Alcon from 22 analysts is for revenues of US$10.4b in 2025. If met, it would imply a satisfactory 4.5% increase on its revenue over the past 12 months. Statutory per share are forecast to be US$2.10, approximately in line with the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of US$10.4b and earnings per share (EPS) of US$2.14 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at CHF90.78, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Alcon at CHF103 per share, while the most bearish prices it at CHF71.36. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Alcon shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Alcon's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 4.5% growth on an annualised basis. This is compared to a historical growth rate of 7.5% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.5% per year. Factoring in the forecast slowdown in growth, it seems obvious that Alcon is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Alcon. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at CHF90.78, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Alcon going out to 2027, and you can see them free on our platform here.

You can also view our analysis of Alcon's balance sheet, and whether we think Alcon is carrying too much debt, for free on our platform here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.